CENTRAL VERMONT R. CO. v. SOPER et al., 59 F. 879

PUTNAM, Circuit Judge. This suit was brought against the Central Vermont Railroad Company, which was not only a common carrier from Ogdensburg towards Boston, but also proprietor of elevators at Ogdensburg, in one of which the grain of plaintiffs below was destroyed by lire, the elevator also being totally consumed. The grain was shipped August 11, 1890, at Chicago, on the barges or steamers of the Ogdensburg Transit Company, stated in the bills of lading to be bound for Ogdensburg, and there, according to the bills of lading, to be delivered to the next carrier for forwarding to the place of final destination.

The bills of lading showed that the grain was consigned to the order of the plaintiffs, and specified the through rate of freight from Chicago to Boston. They also had indorsed across the face: “Hold a;t Ogdensburg for orders.” They also provided that “these companies” (meaning any company or carrier concerned in the transportation from Chicago to Boston) should not be responsible as common carriers for the grain “while at any of their stations awaiting delivery” to the consignee or the next carrier; adding, further, that while so awaiting the companies were liable as warehousemen only.

Accordingly, the grain was forwarded, water-borne, to Ogdensburg, and there warehoused in one of the elevators of the defendant below. When it was destroyed, it was there awaiting further orders from the plaintiffs below, as provided in the memorandum written across the face of the bills of lading. The bills of lading also provided that, among other charges and liens on the property, was the “expense of storage.”' Bo that, while the case does not show, specifically, that the defendant below was to receive elevator charges, yet this may be inferred from this expression.

Certainly, no point was made by defendant below to the contrary. So that the liability at the time the grain was destroyed was as warehouseman, and as warehouseman only. Certain questions of pleading arise in the case which we feel bound to state, but which, on the exceptions, will be found to be unimportant on this appeal.

Under the Massachusetts practice acts, the plaintiffs below combined in their declaration two classes of counts, — one on the bills of lading, or on the agreements contained in them, taking the place of assumpsit at common law, and the other in tort, based on the common-law liability of carriers and warehousemen, and corresponding to the common-law action on the case for negligence. An objection was taken by the bill of exceptions that counts of the latter class are not sustainable.

But the common law permitted actions against carriers and ware-housemen for the loss of merchandise actually delivered into their possession to be brought either in assumpsit, or in case for negligence, at the option of the owner of the merchandise. This is so clearly settled that it needs no explanation here. The principles on which this option was based were undoubtedly carried into the practice acts of Massachusetts with only this qualification: That, under those acts, counts in tort and for breaches of contract may be united in one declaration.

Therefore, the propositions for the defendant below in this behalf do not meet the approval of the court. It is said in the bill of exceptions that at the trial the plaintiffs below elected to proceéd on the third count alone. This count, as well as all the other counts in the declaration, was framed against the defendant below7 as a common carrier, while, clearly, its' liability, if it exists, is as a warehouseman, — a substantial variance, which, however, was waived, so far as this bill of exceptions is concerned, and is of importance here only with reference to a matter wdiich will be next referred to.

One of the main branches of defense is based on a provision in the bills of lading that no action should be sustained for loss or damage unless a claim therefor was made within a time specified, and a suit brought within another time specified. On this appeal, plaintiffs below main! a in that this defense cannot be availed of, because it was not set up in the answer.

On general rules of pleading, inasmuch as it was not necessary for the plaintiffs below to set out this provision, as it is in the nature of condition subsequent, it would seem that a mere denial of the allegations of the. declaration would not raise the issue which the defendant below has raised on this part of the case, and that, therefore, if the defendant below relied upon it, it should have been specially pleaded.

However, the parties have not called our attention to any decision bearing directly on this question as it arises under the practice acts of the state, and it is not necessary that we should determine it. Federal courts justly seize upon slight circumstances for establishing a waiver of defects or errors appearing in the pleadings or in the course of a trial, which might be remedied if objection was seasonably taken, and they ordinarily hold that such waiver is implied from the mere fact that no objection is taken.

If the answer was insufficient, on objection being taken the insufficiency could have at once been removed by an amendment; and if the plaintiffs below permitted the defendant below to urge in that court this defense, which is the principal one set up in the cause, without then raising any question of pleadings, the mere silence of the plaintiffs below7 was a sufficient waiver in this behalf.

The exceptions show that the learned judge of the circuit court submitted this question to the jury; thus indicating either that no objection was taken on the score of a defective answer, or that, if any was taken, it ivas overruled by him.

In the absence of any statement touching this matter in the bill of exceptions, it is impossible for this court to determine which of these two contingencies existed in the court below; and, as the rulings of that court are presumed to be correct in all matters not shown by the bill of exceptions, it was the duty of the plaintiffs below, if they raised this question at the trial, and there insisted upon it, to have had that fact appear in the bill.

In the absence of anything expressly to the contrary, this court must, assume that any objection oí that character was waived, upon the same grounds and for the same reasons that it must assume that the variance between the third count, charging the defendant below as common carrier, and the proofs, showing its liability to be that of warehouseman, was also waived. .Although the conclusions which we reach do not necessarily require us to notice the exceptions touching the admissibility of evidence, nevertheless, as the case must go back for a new trial, and the same evidence will probably again be offered, it seems advisable that we should express our views concerning them.

First of all, we desire to say that, although the bill of exceptions assumes to make all the evidence and proceedings in the court below a part of it, yet, whatever we might do in the case of a substantial error, clearly contrary to the law and justice of the case, we cannot be required to look outside of the bill with reference to any question, except the request of the defendant below that the court should instruct the jury to return a verdict in its favor on the whole evidence.

The authorities sustaining this proposition will be found summed up in an opinion of the circuit court of appeals for the fourth circuit in Improvement Co. v. Frari, 58 Fed. 171. And, if we did thus look into the record at large, we might find that there was no question touching the admissibility of evidence requiring our attention, because all such questions were raised by mere objections, without assigning flu* grounds for the objections, and therefore without furnishing the basis of exceptions.

Authorities on this well-settled point are referred to in the opinion of the circuit court of appeals for the eighth circuit in U. S. v. Shapleigh, 4 C. C. A. 237, 54 Fed. 126, 137. It is not impossible that the testimony which we have to consider, was inadmissible, or should have been stricken out, in a certain view' of it not presented by the bill of exeexxtions, although there suggested, with reference to the evidence of Linton. -This testimony relates to the bearings at the foot of the lofting leg. It was claimed by the defendant below that there was no evidence that the fire originated at that point.

It is frequently the right and the duty of the trial court to admit evidence which, when admitted, is not apparently relevant, upon the assurance of counsel that it will afterwards be connected.

This relates to the order of a trial, but it does not deprive the party against whom the evidence is offered of his just rights with reference to it. lie may object to it on the ground of irrelevancy at the time it is offered, and, if not afterwards connected, move to have it stricken out; and, if not stricken out, he, b,y thus seasonably objecting at the outset, and seasonably renewing his objection, secures to himself a legal right to exceptions.

It may be that all this testimony came in under such circumstances; so that, if there was no evidence at the close of the plaintiffs’ case connecting the fire with the foot of the lofting leg, the defendant below, having seasonably objected when the evidence was offered, and possibly wlthout doing so, was, perhaps, for the reasons stated, entitled, on renewing objections, to have it stricken out.

With reference to the testimony of Linton, the bill of exceptions states that his evidence was admitted upon the understanding that the plaintiffs below would prove that the condition of things at the foot of the lofting leg, at the time of the fire, was substantially the same as it was at the time with reference to which the witness testified, but there is nothing in the bill showing that the defendant below subsequently called the attention of the court to it anew; - so that this statement in the bill is wholly ineffectual.

Therefore, on the face of the bill, all the objections to the testimony ruled in relate entirely to its quality; and in no particular to its relevancy in connection with other evidence as to the place where the fire originated. Those portions of the evidence of Linton and Jenkins which were objected to relate entirely to the tendency of things, — inanimate objects, — being, in this case, the machinery. The plaintiff in error has argued as though they related to the peculiar habits of certain specified human beings.

The distinction is a broad one; and, if it is kept in mind, the evidence was clearly admissible, for the purpose, not of showing that the employes of the defendant below were negligent, but of showing facts, some of which the jury might, perhaps, have assumed without evidence,, namely, that it is the tendency of certain parts- of rapidly-running machinery to get heated, and of dust in mills where grain is ground or stored to be of a highly inflammable character.

These facts might have been properly brought to the attention of the jury, both for the purpose of showing a point where the fire might have originated, and also of showing the necessity of care to guard that point. Maguire v. Railroad Co., 115 Mass. 239, cited by the plaintiff in error, which related to the negligent acts on other occasions of the defendant’s driver, for whose unskilfulness he was sued, is not in point.

The fact that the tendency to get heated, and the inflammable character of the dust, were explained by witnesses, even if the jury might have assumed a part thereof as true without proof, cannot prejudice either party. The testimony of O’Connor, objected to, goes a little further. He stated, in substance, that he had known of instances when the bearings at the foot of the lofting leg became heated, and that he had also known the dust to become ignited at this point. This evidence is clearly within the rule established in Railroad Co. v. Richardson, 91 U.

S. 454, and in the other cases referred to in Railway Co. v. Johnson, 10 U. S. App. 629, 4 C. C. A. 447, 54 Fed. 474.

The defendant below also excepted to certain rulings of the learned judge of the circuit court with reference to its duty as to guarding against fires of incendiary origin; and it now claims that the learned judge, in instructing the jury with reference to this matter, should have ruled that it was obliged to show only such diligence and precaution as the exigencies of the particular service in question reasonably required, and was not obliged to guard against unforeseen and unprecedented occurrences.

It seems to us that the instruction of the court objected to was strictly in accordance with the law, yet, notwithstanding this, the way in which some expressions in it were emphasized might possibly have misled the jury; and, probably, if the learned judge had been requested to instruct additionally in the language which, the plaintiff in error now insists upon, he might properly have done so.

It; does not appear, however, from the bill of exceptions, that the defendant below objected to any specific expressions, or asked the court to give any additional instructions; and as the rulings were strictly in accordance with law, as already stated, the exception on this point cannot be sustained, in the absence of something more specific than the record presents.

The most important question in this case turns on the following language in the bills of lading: “The said company” (meaning the Ogdensburg Transit Company, whose part of the transit was water-borne from Chicago to Ogdensburg) “shall not, nor shall any carrier, person, or party aforesaid,” (meaning “any carrier or any person or party in possession of” the grain during its transit from Chicago to Boston,) “he liable, in any case or event, unless written claim for the loss or damage shall he made to the person or party sought to he made liable within thirty days, and the action in which said claim shall, be sought to be enforced shall be brought within three months after said loss or damage occurs.” It is now settled that such questions appertain to the domain of general law, and that in determining them the federal courts are not hound by the decisions of the courts of the states in which the contracts were made, or by other local decisions.

We have not been referred to, nor have we found, any decisions touching this subject-matter, which are binding on us, except Riddlesbarger v. Insurance Co., 7 Wall. 386, and Express Co v. Caldwell, 21 Wall. 264. Nor, except upon the proposition that provisions of this kind are not necessarily contrary to public policy, have the decisions of the courts, either in the United Btat.es or England, become sufficiently settled to afford us any satisfactory guide.

They are very contradictory and inconsistent, as will be seen by turning to the mass of them cited in Wheeler on the Modern Law of Carriers (page 123,) and in Hutchinson on Carriers, (2d Ed., § 259.) The fundamental proposition that parties exercising the quasi public functions of common carriers cannot, at their pleasure, impose conditions beyond those which the law imposes, is too well settled to need elaboration, resting, as it does, both upon general grounds of public policy, and ..upon the fact that a sliipper of merchandise does not ordinarily stand on an equal footing with the carrier.

Yet it must be confessed that where bills of lading are in printed form like those at bar, and therefore apparently in common use, and no suggestion is made that they are not in such use, and no suggestion that there has been any public or private complaint touching them, although, on account of their general use, the stipulations must be well known to ordinary shippers, this court should be well satisfied, before holding that clauses as to which there has been no line of decisions by other courts, or of expressions by the text writers, are unreasonable, and therefore void.

We must take this provision in its consolidated form. As such, it relates, not only to such portion of the transit as is carriage at common law, but also to such portion as is warehousing. If the provision had been limited to the latter, the position might be different; but, as it stands, we must test it with reference to the former. So, also, it covers, not only damage, but loss.

If it had been limited to damage, and this with reference to the time when the damage was ascertained, or when the merchandise came into the hands of the consignee, it might all be valid, on the same principle on which, in many jurisdictions, it is held a reasonable state of the law to require that a person claiming a warranty cannot, after receipt and opportunity to inspect the merchandise purchased, set up a breach on account of what was patent, or what might have been discovered.

But in the case at bar the provision relates, not only to damage ascertainable on the arrival of the goods, but also to damage wherever occurring, and to loss wherever occurring;. The court cannot fail to take judicial knowledge of the fact that on bills of lading like these, with a right to hold at Ogdensburg for orders, the entire transit may not unreasonably consume the whole of 30 days.

As the damage, or even the loss of part, might be in the early stages of the transit, it is not unreasonable to suppose that it might well happen, in many ordinary cases, that the loss or damage will faff to even come to the knowledge of the consignee within the short period named for giving notice of his claim.

Moreover, the delay involved in correspondence touching occurrences over so long a transit, coupled with the unreasonableness of requiring that in the event of loss or damage the consignee should at once go upon the route, in lieu of availing himself of the usual methods by mail, must in many cases, in the ordinary course, be so grpat as to enable the court to assume that the time named would not ordinarily give reasonable opportunity for investigation, so far as to enable consignees to state properly a written claim, or even to know against whom the claim" should be made. Express Co. v.

Caldwell, ubi supra, does not directly aid the court on this point, because there the carriage covered ordinarily but a single day, and the time allowed for giving the notice was 90 days from delivery to the express company; but the line of argument in that case is impliedly against the reasonableness of the period of 30 days allowed in the case at bar.

On the whole, without attempting to balance the conflicting decisions relative to matters of this sort, which would be of no advantage, especially as the circumstances are so apt to differ, the court is satisfied that, in view' of the consolidated form of this provision, the portion of it. which requires a wilt ten claim for loss or damage to be made within 30 days after the loss or damage occurs, covering a transit which may be expected to be so long as this one may be, is so liable to defeat valid claims, notwithstanding the best of diligence and good faith on the part of the consignees, that it must be held void.

The ruling of the court below in this particular was correct, but the other limitation of three months contained in the same bills of lading cannot be so clearly criticised. Riddlesbarger v. Insurance Co., 7 Wall. 386, already cited, is directly in point that the limitation of the time of suit to three months, contained in these bills of lading, is not invalid on the mere ground that it contravenes the statute of limitations; and this case, with Express Co. v.

Caldwell, 21 Wall. 264, already cited, seems to be sufficient to justify the court in holding that this limitation is not invalid, provided it is not in its nature unreasonable. Neither of these decisions, however, nor any other which binds this court, goes further 'than this in aiding this court in the case at bar.

Parties having agreed to this provision without: protest, and, as already said, the bills of lading being apparently in common and public use, with apparent general acquiescence, it would seem to rest on the court to sustain the provision, unless It find it unreasonable; and such is the state of the law, in any event.

On the whole, the court concludes that there have not been brought; to its attention, on the record, as it: now stands, sufficient considerations to enable the court to pronounce unreasonable the limitation of three months now in question, although the limit of time is sufficiently short to bring it within the held of doubt, and to leave its solution to stand upon the fact that the presumption is in its favor, unless the court is satisfied that it ought to be held void.

The court does not deem it proper to go beyond that general statement at present, or to enter into detailed discussion, as the case must go back for a new trial, and it is possible that the question may come before the court again with considerations and circumstances somewhat modified.

So far this court agrees with the learned judge who presided at the trial; hut, perhaps for the purpose of raising the question, he gave the plaintiffs below the benefit of an exception to (bis stipulation as stated in the bills of lading, in the following form: “My instruction is that this limitation is binding upon the plaintiffs, and they will be bound to pursue their remedy within ninety days, provided they had full knowledge of the cause of the fire.” Then comes another sentence, in which the learned judge gave the plaintiffs the benefit of the circumstances of their not being "wanting in the exercise of reasonable diligence to ascertain the situation,” and then the following: “But If you should find that the plaintiffs had full knowledge, within the ninety-days period, of the cause of the fire, or if, by the exercise of reasonable diligence, they could have discovered the cause, then they cannot recover, as their suit should have beta brought within that period.” Then comes an instruction that; the burden of proof on this proposition rests on the plaintiffs below, which was correct.

We do not consider, nor is it necessary for us to consider, whether there is any evidence in the cause touching the knowledge which the consignees had, or touching their exercise of reasonable diligence to ascertain, concerning the loss, which justified the submission to the jury of the issues covered by the instructions now under consideration, because we are not satisfied that any such exception as these instructions imply can be raised, under any circumstances which have been brought to our attention.

To incorporate this exception, or any exception whatever, is to go beyond the letter of the contract, and put into the mouths of the parties words which they themselves have not used. There are circumstances under which this may be done by necessary implication; but they are of an extreme character, such as the intervention of war prohibiting a suit by one party against the other, or an injunction from some court accomplishing the same prohibition, or the absconding or absence of the party against whom the claim is to be made.

Very likely an exception would arise, if there was an entire láck of knowledge on the part of the consignee, during the entire period of limitation, of the existence of any loss or damage, when coupled with a lack of circumstances imposing the duty of making inquiry, or for so much of the period as practically bars investigation during what remains of it, even with the utmost diligence.

We do not undertake to define accurately all the possible exceptions, or to hold that there are not others, as it is not now. necessary that we should; but the exception made at the trial does not grow out of matter of an extraordinary character, arising from the necessity of things, like those which we have instanced. It involves only circumstances transpiring in the ordinary course of transactions, and which, therefore, must be assumed to have been anticipated and met by the express stipulation which the parties have agreed on.

We are therefore of the opinion that, as the case stands, the plaintiff in error must prevail on its exception to the refusal of the learned judge to direct a verdict for it on the ground that it appeared that the plaintiffs below did not bring their action for the loss within three months after it occurred. Judgment reversed. New trial ordered.